The purpose of this project is to assess the impact of managed care and Medicare/Medicare volumes have on the prevalence and outcomes of hospital restructuring/reengineering efforts and the consequences of internal restructuring/reengineering on hospital costs. Specifically, this research is designed to answer two major questions: 1) Does increased managed care penetration and Medicare/Medicaid volumes raise the likelihood of a hospital initiating restructuring/reengineering efforts? 2) What factors influence the magnitude and scope of restructuring/reengineering efforts in hospitals and how is the magnitude of internal restructuring/reengineering associated with changes of hospital cost? What portion per discharge cost is attributed to length of stay versus other factors such as skill mix and other structural changes? The research will also investigate several subsidiary questions: 3) Are there combinations (bundles) of restructuring/reengineering efforts that result in lower cost and higher productivity? 4) What organizational and programmatic characteristics influence the outcomes of restructuring/reengineering efforts? A survey of 3,134 hospitals co-sponsored by the American Hospital Association (AHA) and the Leonard Davis Institute (LDI) will furnish a rich and unique data set that will provide a detailed description of the many internal structural changes that have recently taken place in U.S. hospitals. All U.S. acute care hospitals with more than 100 licensed beds in metropolitan service areas greater than 50,000 population will be surveyed. Consistent with past AHA surveys, a 50 to 60 percent survey response rate is anticipated. This survey data will be combined with other longitudinal AHA hospital, Medicare, Medicaid, InterStudy managed care data to examine the differential impact of hospital restructuring/reengineering programs. This study will determine the extent that managed care growth and Medicare/Medicaid volumes motivate internal hospital restructuring/reengineering efforts and the impact these efforts have in reducing overall hospital costs.